I’ve come to a realization about buying cars...

"Supreme Chancellor and Glorious Leader SaveTheIntegras" (jegoingout)
03/24/2019 at 20:14 • Filed to: None

Buying a car BRAND new and I mean your average car, is a horrible decision. I knew every new car depreciates the moment it’s driven off a lot but I never truly knew how much until I started doing this entire wholesale stuff. For instance, brand new Jeep’s with their 50k+ stickers can be bought used with sub 12k miles for some $10,000 or more back of MSRP.

DISCUSSION (21)

Nothing > Supreme Chancellor and Glorious Leader SaveTheIntegras
03/24/2019 at 20:21

That’s assuming people play MSRP. When I was seriously shopping Jeeps, I was getting quotes around 4% under invoice, about $8k off sticker. My 4Runner was just a tick over $36k, with sticker of $42k.

AestheticsInMotion > Nothing
03/24/2019 at 20:28

And also assuming resale is a large factor. Some people would rather just have the new vehicle and take the financial hit. It also m akes a lot of sense to buy new for companies that lose a ton of money having vehicles in the shop for repairs.

Dr. Zoidberg - RIP Oppo > Supreme Chancellor and Glorious Leader SaveTheIntegras
03/24/2019 at 20:33

If you can afford it, and you’re happy, and you keep it for a few years, I don’t think it’s a bad personal decision . It could be a bad *financial* decision on a case-by-case basis, yes. But we can’t all drive 200k mile Corollas we picked up for a few grand for 24 years.

Full of the sound of the Gran Fury, signifying nothing. > Supreme Chancellor and Glorious Leader SaveTheIntegras
03/24/2019 at 20:40

Yes, that would seem to apply to fancier vehicles with lots of options and packages as the price seems to be based more on image than on substance. How much more could it really cost to load up a pickup with luxury goodies as compared to what comes on a basic work truck? Not much, really, especially when you see those fancy luxury trucks being discounted by $10-15K or more.

Those buying fancy luxury trucks or SUVs are probably going to get bored in a few years and buy another newer version of the same, and the manufacturers are happy to take advantage of this. The trick is to buy a car that nobody wants and keep it for years. I bought a base model minivan as the next year’s models were coming out. It was the dealer’s loss-leader and I got it for 20% of of list price. I also don’t plan on replacing it anytime soon, so I don’t have to worry about a depreciation hit like those that ‘need’ the latest and greatest with all of the toys and gadgets and safety features. I’ll gladly let the impatient take whatever the dealer has on their lot, and I’ll patiently wait to get what I want.

nermal > Supreme Chancellor and Glorious Leader SaveTheIntegras
03/24/2019 at 20:43

It depends on a lot of things. Specifically, how you buy, use, and sell your cars, along with your financial situation.

If you can buy an aggressively discounted model & keep it on a standard 5 or 6 yr loan until it’s paid off, new isn’t always a bad thing. Gett ing a new BMW Leasemobile every 3 yrs isn’t always a bad thing either in the big picture.

Where people run into problems is doing an 84 month loan on a new Jeep Renegade while rolling over $5k in negative equity from their previous car, then trying to trade out of it 1 or 2 yrs down the road.

The “little” Jeeps have ~$5k in incentives on them at all times. So, the “real” value of them isn’t the ~$30k MSRP, but actually $25k. Finance the full $30k MSRP (which most banks will allow with reasonable credit), add in the $5k you lose driving off the lot, and BAM, you’re $10k upside down.

RacinBob > Supreme Chancellor and Glorious Leader SaveTheIntegras
03/24/2019 at 21:08

I think it depends on the car. For my Civic Si, new was the only choice as the payments for used were the same as new because Honda’s don’t depreciate. Besides, I am going to run it 13 or 14 years so I’m not so sensitive about 1st cost.

My observation is when you are buying used, the prices start getting real good at about 6 years. The reason I believe is that banks will only finance a 6 year old car for only 2 or three years and as such, the payments start looking worse than a 2 year old lease return which they will finance for 6 years . So, if you have cash, the sweet deals are at 6 years.

I think the goal ought to be $1000 a year for depreciation and light maintenance. You can do it if you buy at 6 years and drive to 12. At 15 years, I generally feel the car is at declining value as corrosion of upper midwest takes over.

Anyway, that’s my take...

BrianGriffin thinks “reliable” is just a state of mind > Supreme Chancellor and Glorious Leader SaveTheIntegras
03/24/2019 at 21:13

I’ve decided that, while that’s a good point, I’m in favor of buying new. I’ve been losing my mind for the past three MONTHS trying to find the exact brand / trim / color in decent condition with low miles close to where I live. It’s impossible, because not all of the used car websites show every car and some dealers don’t use those websites at all. Yeah, a new car might cost 20% more than a two-year old one, but the convienence of going to any dealership and saying “that one” is huge.

Just Jeepin' > Supreme Chancellor and Glorious Leader SaveTheIntegras
03/24/2019 at 21:56

Keep in mind, there are a few dealerships across the country that offer 5% off invoice for a brand new Jeep .

10% off MSRP for a used Jeep isn’t actually a great deal.

gmporschenut also a fan of hondas > AestheticsInMotion
03/24/2019 at 22:38

it is funny how people value their time. A project manager at work and I were discussing tasks, and he goes “f%^# that, you’re getting billed out at __ an hour, just get a new one”. meanwhile this guy owns 3 cars, each with over 15 0k, because he refuses to spend over 5k for car, and at least one is always needing something to be fixed.

wafflesnfalafel > Supreme Chancellor and Glorious Leader SaveTheIntegras
03/24/2019 at 22:48

depends entirely on depreciation - I’d never get a relatively new used Jeep, Toyota Tacoma or 4runner or Subaru at this point, but a BMW 3 series or a Buick, absolutely

My bird IS the word > Supreme Chancellor and Glorious Leader SaveTheIntegras
03/24/2019 at 22:49

Wa rranties, mostly. 20k for an awesome dd is 4k more than I paid last time but I have 6 years of hassle free ownership to look forwards to.

gmporschenut also a fan of hondas > nermal
03/24/2019 at 22:50

I know someone that super ran over the lease mile age, and their solution was to roll into another lease. Did they increase the mileage? nope, so now 3 years later they;re in the same shit

lscrx > Supreme Chancellor and Glorious Leader SaveTheIntegras
03/24/2019 at 23:11

With my wife’s Forester, we ended up buying a new 2019 after walking away from another dealer that had a 2017 with low miles. The 2019 had more standard equipment, and the price was close to the used one... not to mention the salesman at the first dealership was an asshat. Also the interest rate for the '19 was a good bit lower than the 2017 as I recall.

WilliamsSW > gmporschenut also a fan of hondas
03/24/2019 at 23:26

Seems to me that if you blow out your lease mileage, the thing to do is buy the car outright - though you need to do some homework on the cost/benefit to that, of course. If you have a nosebleed residual (looking at you, BMW!) that might not work. You also might have some leverage if you roll into the same brand, too.

gmporschenut also a fan of hondas > WilliamsSW
03/24/2019 at 23:44

that is what i recommended, but then he had some dumb shit about not getting locked down, which is a luxury

If buying is too much, then you shouldn’t even consider leasing.

Tohru > gmporschenut also a fan of hondas
03/24/2019 at 23:45

I was definitely living that life for awhile.

76 Delta 88, 91 Caprice, 97 Escort. All three of them together cost less than $4k. The state of the fleet was always - 1 drivable, 1 needing a couple hours work to be drivable, 1 needing serious repair

WilliamsSW > gmporschenut also a fan of hondas
03/24/2019 at 23:46

Some people will never learn...

gmporschenut also a fan of hondas > Tohru
03/24/2019 at 23:53

Him and another engineer have this “who is more frugal” wank fest and it drives me nuts.

If you’re (speaking to my coworker) missing work, that repair just went up 2 00 - 400 dollars .

pip bip - choose Corrour > Supreme Chancellor and Glorious Leader SaveTheIntegras
03/25/2019 at 04:57

i don’t worry about resale.

i bought new as i knew i’d keep it for a while

now my 16yo Lancer with 700k+ km has been at rockbottom for resale the last few years.

when i get rid of it, it’ll go straight to the wreckers

Long_Voyager, Now With More Caravanny Goodness > AestheticsInMotion
03/25/2019 at 07:31

It also makes a lot of sense to buy new for companies that lose a ton of money having vehicles in the shop for repairs.

Should this really be an issue at 10-12k miles?

Tapas > Supreme Chancellor and Glorious Leader SaveTheIntegras
03/25/2019 at 08:15

While depreciation might drop the value of a car by that much, the retail market only sees a gap of a few grand between a new and 1 year/lightly used car. Because regular people have no access to the wholesale market.

So it might suck if you buy new and sell quickly. But if you are looking to buy a car , some people will prefer brand new.